Public and Commercial Services Union
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Hutton's pay formula would make private sector workers millionaires

If the heads of the big outsourcing companies were on just 20 times more than the lowest paid, as expected to be proposed as part of a review of public sector pay, all staff in at least one organisation would become millionaires in two years.

While the levels of pay at the top of public sector organisations has been heavily criticised by the government, the real scandal is the salaries of chief executives of the main private companies who receive billions of pounds of taxpayers’ money.

A snapshot of just four of them, using publicly available annual accounts, shows chief executives on more than £1 million in basic pay, bonuses and other benefits - excluding pensions.

The former boss of Hewlett Packard Mark Hurd, who resigned last year, received almost £15 million for 2010. The package was boosted by a £7.6 million pay-off, but in 2009 and 2008 he took home around £18 million and more than £26 million respectively.

Will Hutton is expected to recommend tomorrow (15 Mar) that no one in a public sector organisation should be paid 20 times more than the lowest paid member of staff. This will have little or no effect on low and unequal pay in the civil service, as this is already the case. But if it was applied to Hewlett Packard all staff would be millionaires in just two years.

Instead, some workers in many of these organisations - whose bosses have made no secret of their eager anticipation of increased privatisation - are paid just above minimum wage, with staff in Capita on less in a year than the chief executive Paul Pindar receives in a week.

High executive pay, and the extent of privatisation now and in the future, is the focus of a Channel 4 Dispatches programme due to be broadcast this evening.

PCs general secretary Mark Serwotka said: “While the government lays into high pay in the public sector, the scandal of executives in private companies creaming millions and millions of pounds of taxpayers’ money is going on right under our noses.

“While jobs, pay, pensions and public services are all being cut, these company directors are laughing all the way to the bank with our money.”

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